XNYS:RYN Rayonier Inc Quarterly Report 10-Q Filing - 6/30/2012

Effective Date 6/30/2012

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 FORM 10-Q
(Mark One)
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2012
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
    
For the transition period from              to             
Commission File Number 1-6780
RAYONIER INC.
Incorporated in the State of North Carolina
I.R.S. Employer Identification No. 13-2607329
1301 RIVERPLACE BOULEVARD
JACKSONVILLE, FL 32207
(Principal Executive Office)
Telephone Number: (904) 357-9100

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
YES x        NO  o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
YES x       NO  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer  x
  
Accelerated filer  o
Non-accelerated filer  o
  
Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YES o        NO  x

As of July 19, 2012, there were outstanding 122,766,123 Common Shares of the registrant.




















TABLE OF CONTENTS
 
 

i



PART I.        FINANCIAL INFORMATION

Item 1.         Financial Statements

RAYONIER INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
(Unaudited)
(Dollars in thousands, except per share amounts)
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
SALES
$
371,926

 
$
357,397

 
$
727,706

 
$
715,127

Costs and Expenses
 
 
 
 
 
 
 
Cost of sales
262,555

 
262,772

 
515,868

 
520,283

Selling and general expenses
16,250

 
15,992

 
35,868

 
32,425

Other operating (income) expense, net
(5,299
)
 
709

 
(6,446
)
 
(1,409
)
 
273,506

 
279,473

 
545,290

 
551,299

Equity in income of New Zealand joint venture
170

 
1,149

 
184

 
2,823

OPERATING INCOME
98,590

 
79,073

 
182,600

 
166,651

Interest expense
(16,056
)
 
(12,628
)
 
(27,880
)
 
(25,945
)
Interest and miscellaneous income, net
85

 
314

 
59

 
605

INCOME BEFORE INCOME TAXES
82,619

 
66,759

 
154,779

 
141,311

Income tax expense
(13,540
)
 
(10,305
)
 
(32,264
)
 
(26,446
)
NET INCOME
69,079

 
56,454

 
122,515

 
114,865

OTHER COMPREHENSIVE (LOSS) INCOME
 
 
 
 
 
 
 
Foreign currency translation adjustment
(8,081
)
 
7,442

 
(2,255
)
 
7,729

New Zealand joint venture cash flow hedges
(1,998
)
 
699

 
(793
)
 
132

Amortization of losses from pension and postretirement plans, net of income tax expense of $1,482, $927, $2,850 and $1,854
3,401

 
2,094

 
6,541

 
4,188

Total other comprehensive (loss) income
(6,678
)
 
10,235

 
3,493

 
12,049

COMPREHENSIVE INCOME
$
62,401

 
$
66,689

 
$
126,008

 
$
126,914

EARNINGS PER COMMON SHARE (Note 2)
 
 
 
 
 
 
 
Basic earnings per share
$
0.56

 
$
0.46

 
$
1.00

 
$
0.94

 
 
 
 
 
 
 
 
Diluted earnings per share
$
0.54

 
$
0.45

 
$
0.96

 
$
0.92

 
 
 
 
 
 
 
 
Dividends per share
$
0.40

 
$
0.36

 
$
0.80

 
$
0.72



See Notes to Condensed Consolidated Financial Statements.

1



RAYONIER INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands)
 
June 30, 2012
 
December 31, 2011
ASSETS
CURRENT ASSETS
 
 
 
Cash and cash equivalents
$
189,103

 
$
78,603

Accounts receivable, less allowance for doubtful accounts of $350 and $399
109,294

 
95,008

Inventory
 
 
 
Finished goods
91,394

 
96,261

Work in progress
4,440

 
5,544

Raw materials
14,763

 
18,295

Manufacturing and maintenance supplies
2,254

 
1,898

Total inventory
112,851

 
121,998

Prepaid and other current assets
89,083

 
48,893

Total current assets
500,331

 
344,502

TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION
1,496,425

 
1,503,711

PROPERTY, PLANT AND EQUIPMENT
 
 
 
Land
28,982

 
26,917

Buildings
143,182

 
140,269

Machinery and equipment
1,403,852

 
1,355,897

Construction in progress
145,688

 
96,097

Total property, plant and equipment, gross
1,721,704

 
1,619,180

Less — accumulated depreciation
(1,158,928
)
 
(1,157,628
)
      Total property, plant and equipment, net
562,776

 
461,552

INVESTMENT IN JOINT VENTURE (Note 5)
64,454

 
69,219

OTHER ASSETS
192,591

 
190,364

TOTAL ASSETS
$
2,816,577

 
$
2,569,348

LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
 
 
 
Accounts payable
$
72,732

 
$
72,873

Current maturities of long-term debt

 
28,110

Accrued taxes
40,961

 
5,223

Accrued payroll and benefits
23,305

 
26,846

Accrued interest
18,694

 
7,044

Accrued customer incentives
7,031

 
10,369

Other current liabilities
24,187

 
17,855

Current liabilities for dispositions and discontinued operations (Note 10)
9,843

 
9,931

Total current liabilities
196,753

 
178,251

LONG-TERM DEBT
1,018,093

 
819,229

NON-CURRENT LIABILITIES FOR DISPOSITIONS AND DISCONTINUED OPERATIONS (Note 10)
76,596

 
80,893

PENSION AND OTHER POSTRETIREMENT BENEFITS (Note 12)
140,073

 
140,623

OTHER NON-CURRENT LIABILITIES
24,952

 
27,279

COMMITMENTS AND CONTINGENCIES (Note 9 and 11)

 

SHAREHOLDERS’ EQUITY
 
 
 
Common Shares, 480,000,000 and 240,000,000 shares authorized, 122,538,279 and 122,035,177 shares issued and outstanding
640,177

 
630,286

Retained earnings
829,888

 
806,235

Accumulated other comprehensive loss
(109,955
)
 
(113,448
)
TOTAL SHAREHOLDERS' EQUITY
1,360,110

 
1,323,073

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
2,816,577

 
$
2,569,348



See Notes to Condensed Consolidated Financial Statements.

2



RAYONIER INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)

 
Six Months Ended June 30,
 
2012
 
2011
OPERATING ACTIVITIES
 
 
 
Net income
$
122,515

 
$
114,865

Adjustments to reconcile net income to cash provided by operating activities:
 
 
 
Depreciation, depletion and amortization
66,174

 
62,863

Non-cash cost of real estate sold
2,401

 
1,749

Stock-based incentive compensation expense
9,460

 
8,021

Amortization of debt discount/premium
3,863

 
4,303

Deferred income taxes
(15,044
)
 
(945
)
Amortization of losses from pension and postretirement plans
9,391

 
6,042

Other
(2,168
)
 
(2,600
)
Changes in operating assets and liabilities:
 
 
 
Receivables
(13,773
)
 
(25,222
)
Inventories
7,096

 
1,067

Accounts payable
(9,518
)
 
10,114

Income tax receivable/payable
31,758

 
22,686

All other operating activities
1,524

 
(3,160
)
Expenditures for dispositions and discontinued operations
(4,803
)
 
(4,916
)
CASH PROVIDED BY OPERATING ACTIVITIES
208,876

 
194,867

INVESTING ACTIVITIES
 
 
 
Capital expenditures
(76,246
)
 
(65,211
)
Purchase of timberlands
(8,687
)
 
(12,976
)
Jesup mill cellulose specialties expansion (gross purchases of $72,662 and $3,576, net of purchases on account of $8,664 and $0)
(63,998
)
 
(3,576
)
Change in restricted cash
(14,427
)
 
8,323

Other
(704
)
 
2,626

CASH USED FOR INVESTING ACTIVITIES
(164,062
)
 
(70,814
)
FINANCING ACTIVITIES
 
 
 
Issuance of debt
355,000

 
70,000

Repayment of debt
(188,110
)
 
(145,000
)
Dividends paid
(98,201
)
 
(87,871
)
Proceeds from the issuance of common shares
3,980

 
7,894

Excess tax benefits on stock-based compensation
4,234

 
4,900

Debt issuance costs
(3,653
)
 
(1,663
)
Repurchase of common shares
(7,783
)
 
(7,828
)
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES
65,467

 
(159,568
)
EFFECT OF EXCHANGE RATE CHANGES ON CASH
219

 
232

CASH AND CASH EQUIVALENTS
 
 
 
Change in cash and cash equivalents
110,500

 
(35,283
)
Balance, beginning of year
78,603

 
349,463

Balance, end of period
$
189,103

 
$
314,180

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
 
 
 
Cash paid (received) during the period:
 
 
 
Interest
$
10,936

 
$
19,479

Income taxes
$
10,989

 
$
(448
)
Non-cash investing activity:
 
 
 
Capital assets purchased on account
$
30,175

 
$
11,129



See Notes to Condensed Consolidated Financial Statements.

3



RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)


1.
BASIS OF PRESENTATION
Basis of Presentation
The unaudited condensed consolidated financial statements and notes thereto of Rayonier Inc. and its subsidiaries ("Rayonier" or the "Company") have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC"). In the opinion of management, these financial statements and notes reflect all adjustments (all of which are normal recurring adjustments) necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented. These statements and notes should be read in conjunction with the financial statements and supplementary data included in the Company's Annual Report on Form 10-K for the year ended December 31, 2011, as filed with the SEC.
Subsequent Events
The Company evaluated events and transactions that occurred after the balance sheet date but before financial statements were issued, and one subsequent event was identified that warranted recognition or disclosure. On July 20, 2012, the Board of Directors approved an increase in the quarterly dividend per share from $0.40 per share to $0.44 per share effective for the third quarter 2012 distribution.

2.
EARNINGS PER COMMON SHARE
The impact of the August 24, 2011 three-for-two stock split is reflected for all periods presented in the following table which provides details of the calculations of basic and diluted earnings per common share:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
Net income
$
69,079

 
$
56,454

 
$
122,515

 
$
114,865

Shares used for determining basic earnings per common share
122,455,464

 
121,692,663

 
122,403,388

 
121,557,144

Dilutive effect of:
 
 
 
 
 
 
 
Stock options
669,298

 
741,561

 
692,622

 
731,064

Performance and restricted shares
726,368

 
951,940

 
727,968

 
916,987

Assumed conversion of Senior Exchangeable Notes (a) (b)
2,669,808

 
2,312,093

 
2,830,382

 
1,906,811

Assumed conversion of warrants (a) (b)
890,189

 
493,167

 
1,077,217

 
156,482

Shares used for determining diluted earnings per common share
127,411,127

 
126,191,424

 
127,731,577

 
125,268,488

Basic earnings per common share
$
0.56

 
$
0.46

 
$
1.00

 
$
0.94

Diluted earnings per common share
$
0.54

 
$
0.45

 
$
0.96

 
$
0.92

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
Anti-dilutive shares excluded from the computations of diluted earnings per share:
 
 
 
 
 
 
 
Stock options, performance and restricted shares
318,666

 
143,658

 
326,777

 
197,712

Assumed conversion of exchangeable note hedges (a)
2,669,808

 
2,312,093

 
2,830,382

 
1,906,811

Total
2,988,474

 
2,455,751

 
3,157,159

 
2,104,523

(a) Upon maturity of the Senior Exchangeable Notes (the "Notes"), Rayonier will not issue additional shares for the full difference between the strike price and the market price due to the offsetting exchangeable note hedges (the "hedges"). However, Accounting Standards Codification 260, Earnings Per Share requires the assumed conversion of the Notes to be included in dilutive shares if the average stock price for the period exceeds the strike prices, while the assumed conversion of the hedges are excluded since they are anti-dilutive. Rayonier will distribute additional shares upon maturity of the warrants if the stock price exceeds the strike prices of $41.59 for the Notes due 2012 and $39.67 for the Notes due 2015. For additional information on the potential dilutive impact of the Senior Exchangeable Notes, warrants and exchangeable note hedges, see Note 11 — Debt in the 2011 Annual Report on Form 10-K and Note 13Debt of this Form 10-Q.
(b) The higher shares used for determining earnings per common share were primarily due to an increase in the average stock

4


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

price from $42.77 for the three months ended June 30, 2011 to $43.74 for the three months ended June 30, 2012 and from $41.25 for the six months ended June 30, 2011 to $44.40 for the six months ended June 30, 2012.

3.
INCOME TAXES
Rayonier is a real estate investment trust ("REIT"). In general, only the taxable REIT subsidiaries, whose businesses include the Company's non-REIT qualified activities, are subject to corporate income taxes. However, the Company is subject to U.S. federal corporate income tax on built-in gains (the excess of fair market value over tax basis for property held upon REIT election at January 1, 2004) on taxable sales of such property during calendar years 2004 through 2010 and 2012 through 2013. In 2011, the law provided a built-in-gains tax holiday. Accordingly, the provision for corporate income taxes relates principally to current and deferred taxes on taxable REIT subsidiaries' income and certain property sales.
The Company's effective tax rate is below the 35 percent U.S. statutory tax rate primarily due to tax benefits associated with being a REIT. Effective tax rates for the quarter and year-to-date were 16.4 percent and 20.8 percent compared to 15.4 percent and 18.7 percent in 2011, respectively. The higher tax rate in 2012 was due to proportionately higher expected earnings from our taxable REIT subsidiaries, which was partially offset by the tax credit exchange discussed below.
The U.S. Internal Revenue Code allowed two credits for taxpayers that produced and used an alternative fuel in the operation of their business through December 31, 2009. The alternative fuel mixture credit ("AFMC") was a $.50 per gallon refundable, non-taxable excise tax credit, while the cellulosic biofuel producer credit ("CBPC") was a $1.01 per gallon credit that is nonrefundable, taxable and has limitations based on an entity's tax liability. Rayonier produces and uses an alternative fuel ("black liquor") at its Jesup, Georgia and Fernandina Beach, Florida Performance Fibers mills, which qualified for both credits. The Company claimed the AFMC on its 2009 tax return.
In the second quarters of 2012 and 2011, management approved the exchange of approximately 60 million gallons and 30 million gallons, respectively, of black liquor previously claimed for the AFMC for the CBPC. In order to complete the exchange, Rayonier is required to pay the IRS interest related to funds received for the AFMC in 2010. The net impact of the exchanges was $5.7 million and $4.1 million for the three months ended June 30, 2012 and 2011, respectively. The 2012 net benefit is recorded separately as a tax benefit of $9.1 million and interest expense of $3.4 million. There was minimal interest expense in 2011 related to the exchange. For additional information on the AFMC and CBPC, see Note 8 — Income Taxes in the Company's Annual Report on Form 10-K for the year ended December 31, 2011.

4.
RESTRICTED DEPOSITS
In order to qualify for like-kind exchange ("LKE") treatment, the proceeds from real estate sales must be deposited with a third-party intermediary. These proceeds are accounted for as restricted cash until a suitable replacement property is acquired. In the event that the LKE purchases are not completed, the proceeds are returned to the Company after 180 days and reclassified as available cash. As of June 30, 2012 and December 31, 2011, the Company had $14.4 million and $0 million, respectively, of proceeds from real estate sales classified as restricted cash in Other Assets, which were deposited with an LKE intermediary.

5.
JOINT VENTURE INVESTMENT
The Company holds a 26 percent interest in Matariki Forestry Group ("Matariki"), a joint venture ("JV") that owns or leases approximately 0.3 million acres of New Zealand timberlands. In addition to the investment, Rayonier New Zealand Limited ("RNZ"), a wholly-owned subsidiary of Rayonier Inc., serves as the manager of the JV forests and operates a log trading business.
Rayonier’s investment in the JV is accounted for using the equity method of accounting. Income from the JV is reported in the Forest Resources segment as operating income since the Company manages the forests, and its JV interest is an extension of the Company’s operations. A portion of Rayonier’s equity method investment is recorded at historical cost which generates a difference between the book value of the Company’s investment and its proportionate share of the JV’s net assets. The difference represents the Company’s unrecognized gain from RNZ’s sale of timberlands to the JV in 2005. The deferred gain is recognized on a straight-line basis over the estimated number of years the JV expects to harvest the timberlands.

5


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

6.
SHAREHOLDERS’ EQUITY
 An analysis of shareholders’ equity for the six months ended June 30, 2012 and the year ended December 31, 2011 is shown below (share amounts not in thousands):
 
Common Shares
 
Retained
Earnings
 
Accumulated Other Comprehensive Loss
 
Shareholders’
Equity
 
Shares
 
Amount
 
Balance, December 31, 2010
121,023,140

 
$
602,882

 
$
717,058

 
$
(68,358
)
 
$
1,251,582

Net income

 

 
276,005

 

 
276,005

Dividends ($1.52 per share)

 

 
(186,828
)
 

 
(186,828
)
Issuance of shares under incentive stock plans
1,220,731

 
13,451

 

 

 
13,451

Stock-based compensation

 
16,181

 

 

 
16,181

Excess tax benefit on stock-based compensation

 
5,681

 

 

 
5,681

Repurchase of common shares
(208,694
)
 
(7,909
)
 

 

 
(7,909
)
Net loss from pension and postretirement plans

 

 

 
(46,263
)
 
(46,263
)
Foreign currency translation adjustment

 

 

 
3,546

 
3,546

Joint venture cash flow hedges

 

 

 
(2,373
)
 
(2,373
)
Balance, December 31, 2011
122,035,177

 
$
630,286

 
$
806,235

 
$
(113,448
)
 
$
1,323,073

Net income

 

 
122,515

 

 
122,515

Dividends ($0.80 per share)

 

 
(98,862
)
 

 
(98,862
)
Issuance of shares under incentive stock plans
672,859

 
3,980

 

 

 
3,980

Stock-based compensation

 
9,460

 

 

 
9,460

Excess tax benefit on stock-based compensation

 
4,234

 

 

 
4,234

Repurchase of common shares
(169,757
)
 
(7,783
)
 

 

 
(7,783
)
Amortization of gains/losses from pension and postretirement plans

 

 

 
6,541

 
6,541

Foreign currency translation adjustment

 

 

 
(2,255
)
 
(2,255
)
Joint venture cash flow hedges

 

 

 
(793
)
 
(793
)
Balance, June 30, 2012
122,538,279

 
$
640,177

 
$
829,888

 
$
(109,955
)
 
$
1,360,110

 
7.
SEGMENT AND GEOGRAPHICAL INFORMATION
Rayonier operates in four reportable business segments: Forest Resources, Real Estate, Performance Fibers and Wood Products. Forest Resources sales include all activities that relate to the harvesting of timber. Real Estate sales include all property sales, including those designated for higher and better use ("HBU"). The assets of the Real Estate segment include HBU property held by the Company’s real estate subsidiary, TerraPointe LLC. The Performance Fibers segment includes two major product lines, cellulose specialties and absorbent materials. The Wood Products segment is comprised of lumber operations. The Company’s remaining operations include harvesting and selling timber acquired from third parties (log trading). These operations are reported in "Other Operations." Sales between operating segments are made based on estimated fair market value, and intercompany sales, purchases and profits (losses) are eliminated in consolidation. The Company evaluates financial performance based on the operating income of the segments.
Operating income (loss) as presented in the Condensed Consolidated Statements of Income and Comprehensive Income is equal to segment income (loss). Certain income (loss) items in the Condensed Consolidated Statements of Income and Comprehensive Income are not allocated to segments. These items, which include gains (losses) from certain asset dispositions, interest income (expense), miscellaneous income (expense) and income tax (expense) benefit, are not considered by management to be part of segment operations.

6


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

Total assets, sales, operating income (loss) and depreciation, depletion and amortization by segment including Corporate were as follows:
 
June 30,
 
December 31,
ASSETS
2012
 
2011
Forest Resources
$
1,627,553

 
$
1,603,515

Real Estate
112,555

 
102,682

Performance Fibers
769,780

 
646,447

Wood Products
21,294

 
21,264

Other Operations
21,735

 
24,576

Corporate and other
263,660

 
170,864

Total
$
2,816,577

 
$
2,569,348

 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
SALES
2012
 
2011
 
2012
 
2011
Forest Resources
$
52,663

 
$
57,037

 
$
104,858

 
$
105,217

Real Estate
11,680

 
12,305

 
24,326

 
25,767

Performance Fibers
254,509

 
232,807

 
505,364

 
483,970

Wood Products
23,830

 
17,957

 
43,039

 
33,747

Other Operations
29,268

 
38,508

 
50,409

 
68,920

Intersegment Eliminations (a)
(24
)
 
(1,217
)
 
(290
)
 
(2,494
)
Total
$
371,926

 
$
357,397

 
$
727,706

 
$
715,127

(a)
Intersegment eliminations primarily reflect sales from our Forest Resources segment to our Performance Fibers segment.
  
 
Three Months Ended June 30,
 
Six Months Ended June 30,
OPERATING INCOME (LOSS)
2012
 
2011
 
2012
 
2011
Forest Resources
$
8,249

 
$
11,838

 
$
16,254

 
$
22,888

Real Estate
5,999

 
5,009

 
12,477

 
12,380

Performance Fibers
83,727

 
71,102

 
164,357

 
146,811

Wood Products
4,129

 
(987
)
 
5,052

 
(534
)
Other Operations
1,148

 
(965
)
 
218

 
(166
)
Corporate and other
(4,662
)
 
(6,924
)
 
(15,758
)
 
(14,728
)
Total
$
98,590

 
$
79,073

 
$
182,600

 
$
166,651


 
Three Months Ended June 30,
 
Six Months Ended June 30,
DEPRECIATION, DEPLETION AND AMORTIZATION
2012
 
2011
 
2012
 
2011
Forest Resources
$
17,066

 
$
15,848

 
$
33,900

 
$
31,252

Real Estate
1,600

 
2,231

 
3,445

 
4,921

Performance Fibers
15,139

 
11,783

 
26,500

 
24,498

Wood Products
826

 
834

 
1,582

 
1,655

Corporate and other
375

 
298

 
747

 
537

Total
$
35,006

 
$
30,994

 
$
66,174

 
$
62,863


7


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

8.
FAIR VALUE MEASUREMENTS
Fair Value of Financial Instruments
A three-level hierarchy that prioritizes the inputs used to measure fair value was established in the Accounting Standards Codification as follows:
Level 1 — Quoted prices in active markets for identical assets or liabilities.
Level 2 Observable inputs other than quoted prices included in Level 1.
Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The following table presents the carrying amount, estimated fair values and categorization under the fair value hierarchy of financial instruments held by the Company at June 30, 2012 and December 31, 2011, using market information and what the Company believes to be appropriate valuation methodologies under generally accepted accounting principles:
 
June 30, 2012
 
December 31, 2011
Asset (liability)
Carrying
Amount
 
Fair Value
 
Carrying
Amount
 
Fair Value
 
 
 
Level 1
 
Level 2
 
 
 
Level 1
 
Level 2
Cash and cash equivalents
$
189,103

 
$
189,103

 
$

 
$
78,603

 
$
78,603

 
$

Restricted cash
14,427

 
14,427

 

 

 

 

Current maturities of long-term debt

 

 

 
(28,110
)
 

 
(29,319
)
Long-term debt
(1,018,093
)
 

 
(1,185,347
)
 
(819,229
)
 

 
(994,851
)
Rayonier uses the following methods and assumptions in estimating the fair value of its financial instruments:
Cash and cash equivalents and Restricted cashThe carrying amount is equal to fair market value.
Debt The fair value of fixed rate debt is based upon quoted market prices for debt with similar terms and maturities.
Variable Interest Entity
Rayonier holds a variable interest in a bankruptcy-remote, limited liability subsidiary ("special-purpose entity") which was created in 2004 when Rayonier monetized a $25.0 million installment note and letter of credit received in connection with a timberland sale. The Company contributed the note and a letter of credit to the special-purpose entity and using the installment note and letter of credit as collateral, the special-purpose entity issued $22.6 million of 15-year Senior Secured Notes and remitted cash of $22.6 million to the Company. There are no restrictions that relate to the transferred financial assets. Rayonier maintains a $2.6 million interest in the entity and receives immaterial cash payments equal to the excess of interest received on the installment note over the interest paid on the Senior Secured Notes. The Company's interest is recorded at fair value and is included in "Other Assets" in the Condensed Consolidated Balance Sheets. In addition, the Company calculated and recorded a de minimus guarantee liability to reflect its obligation of up to $2.6 million under a make-whole agreement pursuant to which it guaranteed certain obligations of the entity. This guarantee obligation is also collateralized by the letter of credit. The Company's interest in the entity, together with the make-whole agreement, represents the maximum exposure to loss as a result of the Company's involvement with the special-purpose entity. Upon maturity of the Senior Secured Notes in 2019 and termination of the special-purpose entity, Rayonier will receive the remaining $2.6 million of cash. The Company determined, based upon an analysis under the variable interest entity guidance, that it does not have the power to direct activities that most significantly impact the entity's economic success. Therefore, Rayonier is not the primary beneficiary and is not required to consolidate the entity.
Assets measured at fair value on a recurring basis are summarized below:
 
Asset
 
Carrying Value at
June 30, 2012
 
Level 2
 
Carrying Value at
December 31, 2011
 
Level 2
Investment in special-purpose entity
 
$
2,690

 
$
2,690

 
$
2,690

 
$
2,690

 
 
 
 
 
 
 
 
 
The fair value of the investment in the special-purpose entity is determined by summing the discounted value of future principal and interest payments that Rayonier will receive from the special-purpose entity. The interest rate of a similar instrument is used

8


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

to determine the discounted value of the payments.

9.
GUARANTEES
 The Company provides financial guarantees as required by creditors, insurance programs, and state and foreign governmental agencies. As of June 30, 2012, the following financial guarantees were outstanding:
Financial Commitments
 
Maximum Potential
Payment
 
Carrying Amount
of Liability
Standby letters of credit (a)
$
20,046

 
$
15,000

Guarantees (b)
 
2,555

 
43

Surety bonds (c)
 
7,159

 
1,389

Total financial commitments
$
29,760

 
$
16,432

(a)
Approximately $15 million of the standby letters of credit serve as credit support for industrial revenue bonds. The remaining letters of credit support various insurance related agreements, primarily workers’ compensation and pollution liability policy requirements. These letters of credit will expire at various dates during 2012 and 2013 and will be renewed as required.
(b)
In conjunction with a timberland sale and note monetization in the first quarter of 2004, the Company issued a make-whole agreement pursuant to which it guaranteed $2.6 million of obligations of a special-purpose entity that was established to complete the monetization. At June 30, 2012, the Company has a de minimus liability to reflect the fair market value of its obligation to perform under the make-whole agreement.
(c)
Rayonier issues surety bonds primarily to secure timber harvesting obligations in the State of Washington and to provide collateral for the Company’s workers’ compensation self-insurance program in that state. These surety bonds expire at various dates between 2012 and 2014 and are expected to be renewed as required.
 
10.
LIABILITIES FOR DISPOSITIONS AND DISCONTINUED OPERATIONS
An analysis of the liabilities for dispositions and discontinued operations follows:
 
June 30,
 
December 31,
 
 
2012
 
2011
 
Balance, beginning of period
$
90,824

 
$
93,160

 
Expenditures charged to liabilities
(4,803
)
 
(9,209
)
 
Increase to liabilities
418

 
6,873

 
Balance, end of period
86,439

 
90,824

 
Less: Current portion
(9,843
)
 
(9,931
)
 
Non-current portion
$
76,596

 
$
80,893

 
The Company is exposed to the risk of reasonably possible additional losses in excess of the established liabilities. As of June 30, 2012, this amount could range up to $29 million, allocable over several of the applicable sites, and arises from uncertainty over the availability, feasibility or effectiveness of certain remediation technologies, additional or different contamination that may be discovered, development of new or more effective environmental remediation technologies and the exercise of discretion in interpretation of applicable law and regulations by governmental agencies.
The Company believes established liabilities are sufficient for probable costs expected to be incurred over the next 20 years with respect to its dispositions and discontinued operations. Remedial actions for these sites vary, but include on-site (and in certain cases off-site) removal or treatment of contaminated soils and sediments, recovery and treatment/remediation of groundwater, and source remediation and/or control.
 
11.
CONTINGENCIES
Rayonier is engaged in various legal actions, including certain environmental proceedings, and has been named as a defendant in various other lawsuits and claims arising in the normal course of business. While the Company has procured reasonable and customary insurance covering risks normally occurring in connection with its businesses, it has in certain cases retained some risk through the operation of self-insurance, primarily in the areas of workers’ compensation, property insurance and general liability. These other lawsuits and claims, either individually or in the aggregate, are not expected to have a material adverse effect on the Company’s financial position, results of operations, or cash flow.


9


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

12.
EMPLOYEE BENEFIT PLANS
The Company has four qualified non-contributory defined benefit pension plans covering a significant majority of its employees and an unfunded plan that provides benefits in excess of amounts allowable under current tax law in the qualified plans. Currently, all qualified plans are closed to new participants. Employee benefit plan liabilities are calculated using actuarial estimates and management assumptions. These estimates are based on historical information, along with certain assumptions about future events. Changes in assumptions, as well as changes in actual experience, could cause the estimates to change.
The net pension and postretirement benefit costs that have been recognized during the stated periods are shown in the following tables:
 
Pension
Postretirement
 
Three Months Ended June 30,
 
Three Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
Components of Net Periodic Benefit Cost
 
 
 
 
 
 
 
Service cost
$
2,102

 
$
1,695

 
$
227

 
$
182

Interest cost
4,321

 
4,522

 
242

 
236

Expected return on plan assets
(6,369
)
 
(6,455
)
 

 

Amortization of prior service cost
327

 
340

 
6

 
22

Amortization of losses
4,394

 
2,593

 
156

 
66

Net periodic benefit cost
$
4,775

 
$
2,695

 
$
631

 
$
506

 
Pension
 
Postretirement
 
Six Months Ended June 30,
 
Six Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
Components of Net Periodic Benefit Cost
 
 
 
 
 
 
 
Service cost
$
4,042

 
$
3,390

 
$
437

 
$
364

Interest cost
8,309

 
9,044

 
465

 
472

Expected return on plan assets
(12,248
)
 
(12,910
)
 

 

Amortization of prior service cost
629

 
680

 
12

 
44

Amortization of losses
8,451

 
5,186

 
299

 
132

Net periodic benefit cost
$
9,183

 
$
5,390

 
$
1,213

 
$
1,012

 
 
 
 
 
 
 
 
In 2012, the Company has no mandatory pension contribution requirements and does not expect to make any discretionary contributions.

13.
DEBT
In March 2012, Rayonier issued $325 million of 3.75% Senior Notes due 2022. Approximately $150 million of the proceeds from these notes were used to repay borrowings outstanding under the Company's revolving credit facility. The Company had $430 million of available borrowing capacity under the revolving credit facility at June 30, 2012. The $300 million Senior Exchangeable Notes, which became exchangeable on July 15, 2012 and will remain so through maturity on October 15, 2012, are included in long-term debt due to the ability and intent of the Company to refinance them on a long-term basis.
As of March 31, 2012, the $172.5 million 4.50% Senior Exchangeable Notes due 2015 became exchangeable at the option of the holders for the calendar quarter ending June 30, 2012. Per the indenture, in order for the notes to become exchangeable, the Company's stock price must exceed 130 percent of the exchange price for 20 trading days during a period of 30 consecutive trading days as of the last day of the quarter. During the quarter ending June 30, 2012, the note holders did not elect to exercise the exchange option. Based upon the average stock price for the 30 trading days ending June 30, 2012, these notes are not exchangeable in third quarter 2012.
An asset sales covenant in the Rayonier Forest Resources ("RFR") $112.5 million installment note agreement requires the

10


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

Company, subject to certain exceptions, to either reinvest cumulative timberland sale proceeds for individual sales greater than $10 million (the "excess proceeds") in timberland-related investments or, once the amount of excess proceeds not reinvested exceeds $50 million, to offer the note holders prepayment of the notes ratably in the amount of the excess proceeds. During April 2012, the excess proceeds exceeded the $50 million limit and as a result, repayment of $59.9 million was offered to the note holders through May 15, 2012, at which time they declined and the excess proceeds were reset to zero.    
There were no other significant changes to the Company's outstanding debt as reported in Note 11 — Debt of the Company's 2011 Annual Report on Form 10-K.

14.
ACCUMULATED OTHER COMPREHENSIVE LOSS
Accumulated Other Comprehensive Loss was comprised of the following:
 
June 30, 2012
 
December 31, 2011
Foreign currency translation adjustments
$
32,222

 
$
34,477

Joint venture cash flow hedges
(4,634
)
 
(3,841
)
Unrecognized losses of employee benefit plans, net of tax
(137,543
)
 
(144,084
)
Total
$
(109,955
)
 
$
(113,448
)





11


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

15.
CONSOLIDATING FINANCIAL STATEMENTS
The consolidating financial information below follows the same accounting policies as described in the consolidated financial statements, except for the use of the equity method of accounting to reflect ownership interests in wholly-owned subsidiaries, which are eliminated upon consolidation, and the allocation of certain expenses of Rayonier Inc. incurred for the benefit of its subsidiaries.
In October 2007, Rayonier TRS Holdings Inc. ("TRS") issued $300 million of 3.75% Senior Exchangeable Notes due 2012, and in August 2009 TRS issued $172.5 million of 4.50% Senior Exchangeable Notes due 2015. The notes for both transactions are fully and unconditionally guaranteed by Rayonier Inc. as the Parent Guarantor and Rayonier Operating Company LLC ("ROC") as the Subsidiary Guarantor. In connection with these exchangeable notes, the Company provides the following condensed consolidating financial information in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.

 
CONDENSED CONSOLIDATING STATEMENTS OF INCOME
 AND COMPREHENSIVE INCOME
For the Three Months Ended June 30, 2012
 
Rayonier Inc.
(Parent
Guarantor)
 
ROC (Subsidiary Guarantor)
 
Rayonier TRS
Holdings Inc.
(Issuer)
 
Subsidiaries of
Rayonier TRS
Holdings Inc.
(Non-
guarantors)
 
All Other
Subsidiaries
(Non-
guarantors)
 
Consolidating
Adjustments
 
Total
Consolidated
SALES
$

 
$

 
$

 
$
345,227

 
$
43,584

 
$
(16,885
)
 
$
371,926

Costs and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of sales

 

 

 
250,845

 
26,716

 
(15,006
)
 
262,555

Selling and general expenses

 
1,904

 

 
13,067

 
1,279

 

 
16,250

Other operating income, net

 
(109
)
 

 
(2,330
)
 
(4,011
)
 
1,151

 
(5,299
)
 

 
1,795

 

 
261,582

 
23,984

 
(13,855
)
 
273,506

Equity in income of New Zealand joint venture

 

 

 
167

 
3

 

 
170

OPERATING (LOSS) INCOME

 
(1,795
)
 

 
83,812

 
19,603

 
(3,030
)
 
98,590

Interest expense
(3,117
)
 
(212
)
 
(10,243
)
 
(1,635
)
 
(849
)
 

 
(16,056
)
Interest and miscellaneous income (expense), net
1,544

 
1,659

 
(834
)
 
(4,135
)
 
1,851

 

 
85

Equity in income from subsidiaries
70,652

 
70,948

 
60,407

 

 

 
(202,007
)
 

INCOME BEFORE INCOME TAXES
69,079

 
70,600

 
49,330

 
78,042

 
20,605

 
(205,037
)
 
82,619

Income tax benefit (expense)

 
52

 
4,043

 
(17,635
)
 

 

 
(13,540
)
NET INCOME
69,079

 
70,652

 
53,373

 
60,407

 
20,605

 
(205,037
)
 
69,079

OTHER COMPREHENSIVE (LOSS) INCOME
(6,678
)
 
(6,678
)
 
698

 
698

 
(10,556
)
 
15,838

 
(6,678
)
COMPREHENSIVE INCOME
$
62,401

 
$
63,974

 
$
54,071

 
$
61,105

 
$
10,049

 
$
(189,199
)
 
$
62,401

 

12


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

 
CONDENSED CONSOLIDATING STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
For the Three Months Ended June 30, 2011
 
Rayonier Inc.
(Parent
Guarantor)
 
ROC (Subsidiary Guarantor)
 
Rayonier TRS
Holdings Inc.
(Issuer)
 
Subsidiaries of
Rayonier TRS
Holdings Inc.
(Non-
guarantors)
 
All Other
Subsidiaries
(Non-
guarantors)
 
Consolidating
Adjustments
 
Total
Consolidated
SALES
$

 
$

 
$

 
$
330,812

 
$
43,589

 
$
(17,004
)
 
$
357,397

Costs and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of sales

 

 

 
251,107

 
30,257

 
(18,592
)
 
262,772

Selling and general expenses

 
2,215

 

 
12,985

 
792

 

 
15,992

Other operating expense (income), net

 
36

 

 
1,903

 
(1,230
)
 

 
709

 

 
2,251

 

 
265,995

 
29,819

 
(18,592
)
 
279,473

Equity in income of New Zealand joint venture

 

 

 
167

 
982

 

 
1,149

OPERATING (LOSS) INCOME

 
(2,251
)
 

 
64,984

 
14,752

 
1,588

 
79,073

Interest expense

 
(261
)
 
(12,161
)
 
(144
)
 
(62
)
 

 
(12,628
)
Interest and miscellaneous income (expense), net

 
1,303

 
(1,117
)
 
(4,992
)
 
5,120

 

 
314

Equity in income from subsidiaries
56,454

 
57,748

 
44,783

 

 

 
(158,985
)
 

INCOME BEFORE INCOME TAXES
56,454

 
56,539

 
31,505

 
59,848

 
19,810

 
(157,397
)
 
66,759

Income tax (expense) benefit

 
(85
)
 
4,845

 
(15,065
)
 

 

 
(10,305
)
NET INCOME
56,454

 
56,454

 
36,350

 
44,783

 
19,810

 
(157,397
)
 
56,454

OTHER COMPREHENSIVE INCOME
10,235

 
10,235

 
360

 
360

 
8,020

 
(18,975
)
 
10,235

COMPREHENSIVE INCOME
$
66,689

 
$
66,689

 
$
36,710

 
$
45,143

 
$
27,830

 
$
(176,372
)
 
$
66,689


13


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

 
CONDENSED CONSOLIDATING STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
For the Six Months Ended June 30, 2012
 
Rayonier Inc.
(Parent
Guarantor)
 
ROC (Subsidiary Guarantor)
 
Rayonier TRS
Holdings Inc.
(Issuer)
 
Subsidiaries of
Rayonier TRS
Holdings Inc.
(Non-
guarantors)
 
All Other
Subsidiaries
(Non-
guarantors)
 
Consolidating
Adjustments
 
Total
Consolidated
SALES
$

 
$

 
$

 
$
680,665

 
$
81,755

 
$
(34,714
)
 
$
727,706

Costs and Expenses

 

 

 

 

 
 
 
 
Cost of sales

 

 

 
497,899

 
53,534

 
(35,565
)
 
515,868

Selling and general expenses

 
5,215

 

 
28,579

 
2,074

 

 
35,868

Other operating expense  (income), net

 
12

 

 
(818
)
 
(6,792
)
 
1,152

 
(6,446
)
 

 
5,227

 

 
525,660

 
48,816

 
(34,413
)
 
545,290

Equity in income (loss) of New Zealand joint venture

 

 

 
338

 
(154
)
 

 
184

OPERATING (LOSS) INCOME

 
(5,227
)
 

 
155,343

 
32,785

 
(301
)
 
182,600

Interest expense
(4,366
)
 
(450
)
 
(20,469
)
 
(948
)
 
(1,647
)
 

 
(27,880
)
Interest and miscellaneous income (expense), net
3,455

 
2,986

 
(2,042
)
 
(8,039
)
 
3,699

 

 
59

Equity in income from subsidiaries
123,426

 
126,394

 
106,152

 

 

 
(355,972
)
 

INCOME BEFORE INCOME TAXES
122,515

 
123,703

 
83,641

 
146,356

 
34,837

 
(356,273
)
 
154,779

Income tax (expense) benefit

 
(277
)
 
8,217

 
(40,204
)
 

 

 
(32,264
)
NET INCOME
122,515

 
123,426

 
91,858

 
106,152

 
34,837

 
(356,273
)
 
122,515

OTHER COMPREHENSIVE INCOME (LOSS)
$
3,493

 
$
3,493

 
$
800

 
$
800

 
$
(3,424
)
 
$
(1,669
)
 
$
3,493

COMPREHENSIVE INCOME
$
126,008

 
$
126,919

 
$
92,658

 
$
106,952

 
$
31,413

 
$
(357,942
)
 
$
126,008

 
 
 
 
 
 
 
 
 
 
 
 
 
 

14


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

 
CONDENSED CONSOLIDATING STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
For the Six Months Ended June 30, 2011
 
Rayonier Inc.
(Parent
Guarantor)
 
ROC (Subsidiary Guarantor)
 
Rayonier TRS
Holdings Inc.
(Issuer)
 
Subsidiaries of
Rayonier TRS
Holdings Inc.
(Non-
guarantors)
 
All Other
Subsidiaries
(Non-
guarantors)
 
Consolidating
Adjustments
 
Total
Consolidated
SALES
$

 
$

 
$

 
$
659,077

 
$
86,421

 
$
(30,371
)
 
$
715,127

Costs and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of sales

 

 

 
495,404

 
58,254

 
(33,375
)
 
520,283

Selling and general expenses

 
4,931

 

 
26,055

 
1,439

 

 
32,425

Other operating expense (income), net

 
85

 

 
2,201

 
(3,694
)
 
(1
)
 
(1,409
)
 

 
5,016

 

 
523,660

 
55,999

 
(33,376
)
 
551,299

Equity in income of New Zealand joint venture

 

 

 
361

 
2,462

 

 
2,823

OPERATING (LOSS) INCOME

 
(5,016
)
 

 
135,778

 
32,884

 
3,005

 
166,651

Interest expense

 
(391
)
 
(25,211
)
 
(256
)
 
(87
)
 

 
(25,945
)
Interest and miscellaneous income (expense), net

 
2,640

 
(2,191
)
 
(10,016
)
 
10,172

 

 
605

Equity in income from subsidiaries
114,865

 
117,792

 
89,218

 

 

 
(321,875
)
 

INCOME BEFORE INCOME TAXES
114,865

 
115,025

 
61,816

 
125,506

 
42,969

 
(318,870
)
 
141,311

Income tax (expense) benefit

 
(160
)
 
10,002

 
(36,288
)
 

 

 
(26,446
)
NET INCOME
114,865

 
114,865

 
71,818

 
89,218

 
42,969

 
(318,870
)
 
114,865

OTHER COMPREHENSIVE INCOME
$
12,049

 
$
12,049

 
$
509

 
$
509

 
$
7,830

 
$
(20,897
)
 
$
12,049

COMPREHENSIVE INCOME
$
126,914

 
$
126,914

 
$
72,327

 
$
89,727

 
$
50,799

 
$
(339,767
)
 
$
126,914

 
 
 
 
 
 
 
 
 
 
 
 
 
 


 



15


RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(Dollar amounts in thousands unless otherwise stated)

 
CONDENSED CONSOLIDATING BALANCE SHEETS
As of June 30, 2012
 
Rayonier Inc.
(Parent
Guarantor)
 
ROC (Subsidiary Guarantor)
 
Rayonier TRS
Holdings Inc.
(Issuer)
 
Subsidiaries of
Rayonier TRS
Holdings
Inc. (Non-
guarantors)
 
All Other
Subsidiaries
(Non-
guarantors)
 
Consolidating
Adjustments
 
Total
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
97,335

 
$
35,503

 
$
15,197

 
$
8,020

 
$
33,048

 
$

 
$
189,103

Accounts receivable, less allowance for doubtful accounts

 
90

 

 
106,621

 
2,583